Seat maker paying millions in water pollution suit

Residents of an Elkhart neighborhood receiving $6.25 million from Flexsteel Industries in a settlement of their water pollution lawsuit.

Posted on Dec. 26, 2013 at 12:00 a.m. | Updated on Dec. 26, 2013 at 6:16 p.m.

ELKHART — A Dubuque, Iowa-based furniture maker is paying $6.25 million to settle a lawsuit alleging it polluted the water wells of some Elkhart homes.

Flexsteel Industries admitted no wrongdoing in the settlement, which it disclosed this week in a filing with the U.S. Securities and Exchange Commission.

The affected homes are in the Meadow Farms neighborhood, south of C.R. 106 and an industrial park near Cooper and Marina drives.

The lawsuit, filed in March 2011, alleged that from 1983 through 2007, Dygert Seating and its purchaser, Flexsteel, polluted groundwater in the area with hazardous chemicals, including tricloroethylene, or TCE, an industrial solvent known to cause cancer.

In 2008 the U.S. Environmental Protection Agency and Indiana Department of Environmental Management connected the subdivision to city water after Geocel Corp, a separate company with an operation adjacent to Flexsteel, admitted it had contaminated groundwater. The Geocel groundwater plume was separate from the plume that these plaintiffs alleged was caused by Flexsteel, the public agencies concluded.

The lawsuit against Flexsteel involved nine homes in Meadow Farms. Some of the plaintiffs have moved out while others remain there.

Karen McAtee alleged the contamination caused her biliary cancer, a rare form of cancer that has been linked to TCE. She died of the cancer at age 49 in November 2011. Her husband, Ron McAtee, now lives in an Elkhart apartment. When contacted by The Elkhart Truth on Thursday, Dec. 26, he deferred comment to his Indianapolis-based attorney, Tom Barnard.

Barnard said the settlement prohibited him or his clients from discussing specifics of the case publicly.

“I believe all sides are very pleased that a settlement has been reached,” Barnard said. “The settlement, however, is strictly confidential.”

The $6.25 million will include payment for damages, to remove the contamination, attorney fees and costs, punitive damages and for medical monitoring, since the plaintiffs allege their exposure to TCE puts them at higher risk to develop cancer in the future.

Flexsteel will pay the settlement but is still trying to recoup the money from its two liability insurance carriers. An Iowa judge has ruled for the insurance companies, which have argued they aren't liable, but Flexsteel has appealed the ruling to the Iowa Supreme Court.

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